It has been estimated that more than half of all telecom service invoices contain some type of inaccuracy.
These inaccuracies cause 7–12% of the total dollar expense to be in error.
Even when accounts/payable employees do scrutinize bills, they typically don’t have the specialized knowledge to thoroughly decipher the bills, so the savings yielded are minute compared to the time spent. Alert addresses these problems through validation processes.
To understand the benefits of Alert, you must realize that it is much more than recognizing simple billing errors.
Continued billing for disconnected services past the stop-bill date
So, you have told your provider to cancel a particular service, received the cancel-order number and a stop-billing date. Great! You can mark that one off the to-do list, right? Well, not so fast.
At least 25% of all cancellation orders continue to bill after the committed stop-billing date for months, years or forever. During a client’s telecom inventory audit, we often find there are items still billing that the client canceled years ago. Review the invoice after the stop billing date and confirm the canceled service is no longer billing.
Why does it seem that telecom provider billing errors are always in their favor and not yours? That’s because they are carefully watching for errors that reduce their profitability, and not watching out for your bottom line. Incorrect rates generally materialize in two scenarios:
Newly installed services are not receiving the quoted rates or are missing the quoted discounts. This is usually a provider order-entry error. Make a point of reviewing the rates on a newly installed service to insure you are getting the correct rate. Also, check that your start billing date matches with the actual date the service turned up.
Your contract renewal for lower rates is not applied on your invoice. It takes most telecom providers one to two invoice cycles for your new, bigger discounts to appear on your invoice after the negotiation of a renewal. Watch your invoice. The second or third invoice after your renewal signature should have your lower rates/higher discounts.
Being charged for services that don’t belong to you
You may have heard of the term “cramming.”
This is when add-on services are billed without your approval or knowledge. Accounts targeted for cramming are usually small business dial tone and internet accounts — the kind of accounts you may have for your home office users or small branch locations.
Because each “crammed” service is usually less than $50 per month, the charges often go unnoticed until an audit, when it is determined that you have been paying those charges for years.
In addition, these invoices can often have charges for services that don’t belong to your company.
Alert takes into account all of the necessary telecom expenses— minimizing costs, while maximizing the value of the services you receive.
There are three areas in telecom and network services where Alert can help reduce your expenses: validation, optimization, and outsourcing.
Validation involves making sure bills are correct, and catching any billing or payment errors that might have occurred. Companies often invest many hours with their accounts/payable employees, who only search by hand. Moreover, since telecom bills are notoriously complex and time consuming, accounts/payable employees often skip validation just to keep up with the volume. However, if validation is performed correctly, companies can reap the rewards. Savings are achieved through one-time audits or on-going audits. The most obvious benefits are monetary refunds and credits associated with billing errors. In addition, proper auditing and validation procedures provide the necessary data for higher-level TEM functions.
But validation is not everything as you can see. Validation only catches “visible” errors in the billing process. In fact, enterprises realize only an 8–12% savings when performing validation internally. When the whole TEM lifecycle is performed, however, companies may save 25% or more. Once validation has occurred, companies can move forward and apply knowledge from validation towards the more informed use of suppliers and end users. By drilling down and using analysis software programs on this data, you can improve budget planning, leverage your buying power, change accountability, and alter many other processes.
Internal jobs that do not contribute to your core competency can be more expensive in the long run. The internal operational costs of managing billing, vendors, and employees are high. By outsourcing to TEM experts, your business can do the same jobs at a lower cost—and, most likely, at a higher quality. There are several benefits to outsourcing. Your company will be able to focus better on core competencies. You’ll also be able to control your headcount, experience faster invoicing, and notice more organizational flexibilities.